Bill S151-2011

Implements the empire propane education and research act

Implements the empire propane education and research act; authorizes the creation of certain propane education programs; requires the creation of an empire propane education and research council; enumerates the duties and purposes of the empire propane education and research council.

Memo

BILL NUMBER:S151

TITLE OF BILL: An act to amend the energy law, in relation to implementing the empire propane education and research act

PURPOSE: This legislation would establish the Empire Propane Education and Research Act (PERC) funded through a voluntary fee of 1/10th of one cent assessed on companies which odorize propane with Ethyl Mercaptan intended for sale in New York State.

SUMMARY OF PROVISIONS: Section one of the bill adds a new Article 14 to the Energy Law to establish the Empire Propane Education and Research Act (PERC).

JUSTIFICATION: Under the Federal Propane Education and Research Act (Federal PERC), in 1599 New York State received one-fifth or about $40,000 for purposes specified in the Federal Act--education, safety training, consumer awareness and research and development. Empire PERC would make more money available for instate projects, including increased training of industry, fire personnel and local code officials, distributed power such as fuel cells, turbines and alternate fuel automotive demonstrations. Empire PERC will cost the state nothing -NYSERDA will receive a fee to defray the costs associated with their public member. A certified survey must be conducted among industry members in New York to accept or reject Empire PERC. If approved, the fee must be paid each month, but the company to which it is charged may apply for a refund. NYSERDA would receive a report on the proposed budget and would be entitled to review each program under Empire PERC.

Text

STATE OF NEW YORK
________________________________________________________________________
151
2011-2012 Regular Sessions
IN SENATE
(PREFILED)
January 5, 2011
___________

Introduced by Sen. MAZIARZ -- read twice and ordered printed, and when
printed to be committed to the Committee on Energy and Telecommuni-
cations
AN ACT to amend the energy law, in relation to implementing the empire
propane education and research act
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. The energy law is amended by adding a new article 14 to
read as follows:
ARTICLE 14
EMPIRE PROPANE EDUCATION AND RESEARCH ACT
SECTION 14-101. SHORT TITLE.
14-102. DEFINITIONS.
14-103. REFERENDUM; CREATION AND TERMINATION OF A PROGRAM.
14-104. EMPIRE PROPANE EDUCATION AND RESEARCH COUNCIL.
14-105. ASSESSMENTS.
14-106. COMPLIANCE.
14-107. LOBBYING RESTRICTIONS.
14-108. PRICING.
14-109. RELATION TO OTHER PROGRAMS.
S 14-101. SHORT TITLE. THIS ARTICLE SHALL BE KNOWN AND MAY BE CITED AS
THE EMPIRE PROPANE EDUCATION AND RESEARCH ACT.
S 14-102. DEFINITIONS. FOR PURPOSES OF THIS ARTICLE, UNLESS THE
CONTEXT OTHERWISE REQUIRES:
1. "COUNCIL" MEANS AN EMPIRE PROPANE EDUCATION AND RESEARCH COUNCIL
CREATED PURSUANT TO SECTION 14-104 OF THIS ARTICLE;
2. "PRESIDENT" MEANS THE CHAIRMAN OF NYSERDA OR HIS OR HER DESIGNEE;
3. "EDUCATION" MEANS ANY ACTION TO PROVIDE INFORMATION REGARDING
PROPANE, PROPANE EQUIPMENT, MECHANICAL AND TECHNICAL PRACTICES, AND
PROPANE USES TO CONSUMERS, AND MEMBERS OF THE PROPANE INDUSTRY;

EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00696-01-1

S. 151 2

4. "INDUSTRY" MEANS THOSE PERSONS INVOLVED IN THE PRODUCTION, TRANS-
PORTATION, AND SALE OF PROPANE, AND THE MANUFACTURE AND DISTRIBUTION OF
PROPANE UTILIZATION EQUIPMENT;
5. "INDUSTRY TRADE ASSOCIATION" MEANS AN ORGANIZATION EXEMPT FROM TAX,
UNDER SECTION 501(C)(3) OR 501(C)(6) OF THE INTERNAL REVENUE CODE OF
1986, REPRESENTING THE PROPANE INDUSTRY;
6. "NYSERDA" MEANS THE NEW YORK STATE ENERGY AND RESEARCH DEVELOPMENT
AUTHORITY;
7. "ODORIZED PROPANE" MEANS PROPANE WHICH HAS AN ODORANT ADDED TO IT;
8. "PRODUCER" MEANS THE OWNER OF PROPANE AT THE TIME IT IS RECOVERED
AT A GAS PROCESSING PLANT OR REFINERY; IRRESPECTIVE OF THE STATE WHERE
PRODUCTION OCCURS;
9. "PROPANE" MEANS A HYDROCARBON WHOSE CHEMICAL COMPOSITION IS PREDO-
MINATELY C3H8, WHETHER RECOVERED FROM NATURAL GAS OR CRUDE OIL, AND
INCLUDES LIQUIFIED PETROLEUM GASES AND MIXTURES THEREOF;
10. "PUBLIC MEMBER" MEANS A DESIGNEE OF THE PRESIDENT OF THE NEW YORK
STATE ENERGY RESEARCH AND DEVELOPMENT AUTHORITY;
11. "QUALIFIED INDUSTRY ORGANIZATION" MEANS THE NEW YORK PROPANE GAS
ASSOCIATION, THE NATIONAL PROPANE GAS ASSOCIATION, A SUCCESSOR ASSOCI-
ATION OF THESE ASSOCIATIONS, OR ANY OTHER PROPANE INDUSTRY ORGANIZATION;
12. "RESEARCH" MEANS ANY TYPE OF STUDY, INVESTIGATION OR OTHER ACTIV-
ITIES DESIGNED TO ADVANCE THE IMAGE, DESIRABILITY, USAGE, MARKETABILITY,
EFFICIENCY, AND SAFETY OF PROPANE AND TO FURTHER THE DEVELOPMENT OF SUCH
INFORMATION;
13. "RETAIL MARKETER" MEANS A PERSON ENGAGED PRIMARILY IN THE SALE OF
ODORIZED PROPANE TO THE ULTIMATE CONSUMER OR TO RETAIL PROPANE DISPEN-
SERS; AND
14. "RETAIL PROPANE DISPENSER" MEANS A PERSON WHO SELLS ODORIZED
PROPANE TO THE ULTIMATE CONSUMER BUT IS NOT ENGAGED PRIMARILY IN THE
BUSINESS OF SUCH SALES.
S 14-103. REFERENDUM; CREATION AND TERMINATION OF A PROGRAM. 1. QUAL-
IFIED INDUSTRY ORGANIZATIONS SHALL CONDUCT AT THEIR OWN EXPENSE, A
REFERENDUM AMONG PRODUCERS AND RETAIL MARKETERS FOR THE CREATION OF AN
EMPIRE PROPANE EDUCATION AND RESEARCH COUNCIL. THE COUNCIL, IF ESTAB-
LISHED, SHALL REIMBURSE THE QUALIFIED INDUSTRY ORGANIZATIONS FOR THE
COST OF THE REFERENDUM ACCOUNTING AND DOCUMENTATION. THE REFERENDUM
SHALL BE CONDUCTED BY AN INDEPENDENT AUDITING FIRM AGREED TO BY THE
QUALIFIED INDUSTRY ORGANIZATIONS. THE RESULTS, AS CERTIFIED BY AN INDE-
PENDENT AUDITING FIRM, SHALL BE SUBMITTED TO THE PRESIDENT WITHIN THIRTY
DAYS OF CERTIFICATION. VOTING RIGHTS IN THE REFERENDUM SHALL BE BASED ON
THE VOLUME OF PROPANE PRODUCED OR ODORIZED PROPANE SOLD IN THE PREVIOUS
CALENDAR YEAR. UPON APPROVAL OF THOSE PERSONS REPRESENTING TWO-THIRDS OF
THE TOTAL VALUE OF PROPANE VOTED IN THE RETAIL MARKETER CLASS AND
TWO-THIRDS OF ALL PROPANE VOTED IN THE PRODUCER CLASS, THE COUNCIL SHALL
BE ESTABLISHED, AND SHALL BE AUTHORIZED TO LEVY AN ASSESSMENT ON ODOR-
IZED PROPANE IN ACCORDANCE WITH SECTION 14-105 OF THIS ARTICLE. ALL
PERSONS VOTING IN THE REFERENDUM SHALL CERTIFY TO THE INDEPENDENT AUDIT-
ING FIRM THE VOLUME OF PROPANE REPRESENTED BY THEIR VOTE.
2. ON THE COUNCIL'S OWN INITIATIVE, OR ON PETITION TO THE COUNCIL BY
PRODUCERS AND RETAIL MARKETERS REPRESENTING THIRTY-FIVE PERCENT OF THE
VOLUME OF PROPANE IN EACH CLASS, THE COUNCIL SHALL, AT ITS OWN EXPENSE,
HOLD A REFERENDUM TO BE CONDUCTED BY AN INDEPENDENT AUDITING FIRM
SELECTED BY THE COUNCIL, TO DETERMINE WHETHER THE INDUSTRY FAVORS TERMI-
NATION OR SUSPENSION OF THE COUNCIL. TERMINATION OR SUSPENSION SHALL NOT
TAKE EFFECT UNLESS IT IS APPROVED BY PERSONS REPRESENTING MORE THAN
ONE-HALF OF THE TOTAL VOLUME OF ODORIZED PROPANE IN THE RETAIL MARKETER

S. 151 3

CLASS AND MORE THAN ONE-HALF THE TOTAL VOLUME OF PROPANE IN THE PRODUCER
CLASS.
S 14-104. EMPIRE PROPANE EDUCATION AND RESEARCH COUNCIL. 1. THE QUALI-
FIED INDUSTRY ORGANIZATIONS SHALL SELECT ALL RETAIL MARKETERS MEMBERS
AND PRODUCER MEMBERS OF THE COUNCIL. THE PRESIDENT SHALL DESIGNATE ONE
PUBLIC MEMBER. VACANCIES IN THE UNFINISHED TERMS OF COUNCIL MEMBERS
SHALL BE FILLED IN THE SAME MANNER AS WERE THE ORIGINAL APPOINTMENTS.
2. IN SELECTING MEMBERS OF THE COUNCIL, THE QUALIFIED INDUSTRY ORGAN-
IZATIONS SHALL GIVE DUE REGARD TO SELECTING A COUNCIL THAT IS REPRESEN-
TATIVE OF THE INDUSTRY, INCLUDING REPRESENTATION OF:
(A) GAS PROCESSORS AND OIL REFINERS AMONG PRODUCERS;
(B) INTERSTATE AND INTRASTATE OPERATORS AMONG RETAIL MARKETERS;
(C) LARGE AND SMALL COMPANIES AMONG PRODUCERS AND RETAIL MARKETERS,
INCLUDING AGRICULTURAL COOPERATIVES; AND
(D) DIVERSE GEOGRAPHIC REGIONS OF THE STATE.
3. THE COUNCIL SHALL CONSIST OF NO LESS THAN FIVE AND UP TO SEVEN
MEMBERS, WITH NO LESS THAN FOUR AND UP TO SIX MEMBERS REPRESENTING
RETAIL MARKETERS AND PRODUCERS, AND ONE PUBLIC MEMBER. OTHER THAN THE
PUBLIC MEMBER, COUNCIL MEMBERS SHALL BE FULL-TIME EMPLOYEES OR OWNERS OF
BUSINESSES IN THE INDUSTRY OR REPRESENTATIVES OF AGRICULTURAL COOPER-
ATIVES. NO EMPLOYEE OF A QUALIFIED INDUSTRY ORGANIZATION SHALL SERVE AS
A MEMBER OF THE COUNCIL, AND NO MEMBER OF THE COUNCIL MAY SERVE CONCUR-
RENTLY AS AN OFFICER OF THE BOARD OF DIRECTORS OF A QUALIFIED INDUSTRY
ORGANIZATION OR OTHER TRADE ASSOCIATION. ONLY ONE PERSON AT A TIME FROM
ANY COMPANY OR ITS AFFILIATE MAY SERVE ON THE COUNCIL. THE PRESIDENT MAY
SERVE AS AN EX-OFFICIO NON-VOTING MEMBER OF THE COUNCIL.
4. COUNCIL MEMBERS SHALL RECEIVE NO COMPENSATION FOR THEIR SERVICES,
NOR SHALL COUNCIL MEMBERS BE REIMBURSED FOR EXPENSES RELATING TO THEIR
SERVICE, EXCEPT THAT PUBLIC MEMBERS, UPON REQUEST, MAY BE REIMBURSED FOR
REASONABLE EXPENSES DIRECTLY RELATED TO THEIR PARTICIPATION IN COUNCIL
MEETINGS.
5. COUNCIL MEMBERS SHALL SERVE TERMS OF THREE YEARS AND MAY NOT SERVE
MORE THAN TWO FULL CONSECUTIVE TERMS. MEMBERS FILLING UNEXPIRED TERMS
MAY SERVE NOT MORE THAN A TOTAL OF SEVEN CONSECUTIVE YEARS. FORMER
MEMBERS OF THE COUNCIL MAY BE RETURNED TO THE COUNCIL IF THEY HAVE NOT
BEEN MEMBERS FOR A PERIOD OF TWO YEARS. INITIAL APPOINTMENTS TO THE
COUNCIL SHALL BE FOR TERMS OF ONE, TWO, AND THREE YEARS STAGGERED TO
PROVIDE FOR THE SELECTION OF FOUR MEMBERS EACH YEAR. THE COUNCIL SHALL
NOTIFY THE PRESIDENT OF THE NAME, ADDRESS, AND PROPANE-RELATED AFFIL-
IATION, IF ANY, OF A COUNCIL MEMBER WITHIN THIRTY DAYS AFTER THE
APPOINTMENT OF THE MEMBER TO THE COUNCIL.
6. THE COUNCIL SHALL DEVELOP PROGRAMS AND PROJECTS AND ENTER INTO
CONTRACTS OR AGREEMENTS FOR IMPLEMENTING THIS ARTICLE, INCLUDING
PROGRAMS TO ENHANCE CONSUMER AND EMPLOYEE SAFETY AND TRAINING, TO
PROVIDE FOR RESEARCH AND DEVELOPMENT OF CLEAN AND EFFICIENT PROPANE
UTILIZATION EQUIPMENT, TO INFORM AND EDUCATE THE PUBLIC ABOUT SAFETY AND
OTHER ISSUES ASSOCIATED WITH THE USE OF PROPANE, AND TO PROVIDE FOR THE
PAYMENT OF THE COSTS THEREOF WITH FUNDS COLLECTED PURSUANT TO THIS ARTI-
CLE. THE COUNCIL SHALL COORDINATE ITS ACTIVITIES WITH INDUSTRY TRADE
ASSOCIATIONS, HUDSON VALLEY COMMUNITY COLLEGE, OTHER COMMUNITY COLLEGES
AND OTHERS AS APPROPRIATE TO PROVIDE EFFICIENT DELIVERY OF SERVICES AND
TO AVOID UNNECESSARY DUPLICATION OF ACTIVITIES.
7. ISSUES RELATED TO RESEARCH AND DEVELOPMENT, SAFETY, EDUCATION, AND
TRAINING SHALL BE GIVEN PRIORITY BY THE COUNCIL IN THE DEVELOPMENT OF
ITS PROGRAMS AND PROJECTS.

S. 151 4

8. THE COUNCIL SHALL SELECT FROM AMONG ITS MEMBERS A CHAIRPERSON AND
OTHER OFFICERS AS NECESSARY, MAY ESTABLISH COMMITTEES AND SUBCOMMITTEES
OF THE COUNCIL, AND SHALL ADOPT RULES AND BYLAWS FOR THE CONDUCT OF
BUSINESS AND THE IMPLEMENTATION OF THIS ARTICLE. THE COUNCIL SHALL
ESTABLISH PROCEDURES FOR THE SOLICITATION OF INDUSTRY COMMENT AND RECOM-
MENDATIONS ON ANY SIGNIFICANT PLANS, PROGRAMS, AND PROJECTS TO BE FUNDED
BY THE COUNCIL. THE COUNCIL MAY ESTABLISH ADVISORY COMMITTEES OF PERSONS
OTHER THAN COUNCIL MEMBERS.
9. AT THE BEGINNING OF EACH FISCAL PERIOD, THE COUNCIL SHALL PREPARE A
BUDGET PLAN FOR THE NEXT FISCAL PERIOD, INCLUDING THE PROBABLE COST OF
ALL PROGRAMS, PROJECTS, AND CONTRACTS AND A RECOMMENDED RATE OF ASSESS-
MENT SUFFICIENT TO COVER SUCH COSTS. THE COUNCIL SHALL SUBMIT THE
PROPOSED BUDGET TO THE PRESIDENT FOR REVIEW AND COMMENT. THE PRESIDENT
MAY RECOMMEND PROGRAMS AND ACTIVITIES CONSIDERED APPROPRIATE.
10. THE COUNCIL SHALL KEEP MINUTES, BOOKS, AND RECORDS THAT CLEARLY
REFLECT ALL OF THE ACTS AND TRANSACTIONS OF THE COUNCIL AND MAKE PUBLIC
SUCH INFORMATION. THE BOOKS OF THE COUNCIL SHALL BE AUDITED BY A CERTI-
FIED PUBLIC ACCOUNTANT AT LEAST ONCE EACH FISCAL YEAR AND AT SUCH OTHER
TIMES AS THE COUNCIL MAY DESIGNATE. THE EXPENSE OF THE AUDIT SHALL BE
THE RESPONSIBILITY OF THE COUNCIL. COPIES OF SUCH AUDIT SHALL BE
PROVIDED TO ALL MEMBERS OF THE COUNCIL, ALL QUALIFIED INDUSTRY ORGANIZA-
TIONS, AND TO OTHER MEMBERS OF THE INDUSTRY UPON REQUEST.
S 14-105. ASSESSMENTS. 1. THE COUNCIL SHALL SET THE ASSESSMENT AT NO
GREATER THAN ONE-TENTH OF ONE CENT PER GALLON OF ODORIZED PROPANE.
2. THE OWNER OF ODORIZED PROPANE AT THE TIME OF ODORIZATION, OR THE
TIME OF IMPORT OF ODORIZED PROPANE SHALL MAKE THE ASSESSMENT BASED ON
THE VOLUME OF ODORIZED PROPANE SOLD. THE ASSESSMENT, WHEN MADE, SHALL BE
LISTED AS A SEPARATE LINE ITEM ON THE BILL LABELED "EMPIRE PROPANE
EDUCATION AND RESEARCH ASSESSMENT". ASSESSMENTS COLLECTED FROM PURCHAS-
ERS OF PROPANE ARE PAYABLE TO THE COUNCIL ON A MONTHLY BASIS BY THE
TWENTY-FIFTH OF THE MONTH FOLLOWING THE MONTH OF COLLECTION.
IF PAYMENT IS NOT MADE TO THE COUNCIL BY THE DUE DATE UNDER THIS
SUBDIVISION, AN INTEREST PENALTY OF ONE PERCENT OF ANY AMOUNT UNPAID
SHALL BE ADDED FOR EACH MONTH OR FRACTION OF A MONTH AFTER THE DUE DATE,
UNTIL FINAL PAYMENT IS MADE.
3. THE COUNCIL MAY ESTABLISH AN ALTERNATIVE MEANS OF COLLECTING THE
ASSESSMENT IF ANOTHER MEANS IS FOUND TO BE MORE EFFICIENT AND EFFECTIVE.
THE COUNCIL MAY ESTABLISH A LATE PAYMENT CHARGE AND RATE OF INTEREST TO
BE IMPOSED ON ANY PERSON WHO FAILS TO REMIT OR PAY TO THE COUNCIL ANY
AMOUNT DUE UNDER THIS ARTICLE.
4. PENDING DISBURSEMENT PURSUANT TO A PROGRAM, PLAN, OR PROJECT, THE
COUNCIL SHALL INVEST FUNDS COLLECTED THROUGH ASSESSMENTS, AND ANY OTHER
FUNDS RECEIVED BY THE COUNCIL, ONLY IN OBLIGATIONS OF THE UNITED STATES
OR ANY AGENCY THEREOF, IN GENERAL OBLIGATIONS OF ANY STATE OR POLITICAL
SUBDIVISION THEREOF, IN ANY INTEREST-BEARING ACCOUNT OR CERTIFICATE OF
DEPOSIT OF A BANK THAT IS A MEMBER OF THE FEDERAL RESERVE SYSTEM, OR IN
OBLIGATIONS FULLY GUARANTEED AS TO PRINCIPAL AND INTEREST BY THE UNITED
STATES.
S 14-106. COMPLIANCE. THE SUPREME COURT IS VESTED WITH THE JURISDIC-
TION SPECIFICALLY TO ENFORCE THE PROVISIONS OF THIS ARTICLE, AND PREVENT
OR RESTRAIN ANY PERSON FROM VIOLATING ANY SUCH PROVISION. A SUCCESSFUL
ACTION FOR COMPLIANCE UNDER THIS SECTION MAY ALSO REQUIRE PAYMENT BY THE
DEFENDANT OF THE COSTS INCURRED BY THE COUNCIL IN BRINGING THE ACTION.
S 14-107. LOBBYING RESTRICTIONS. NO FUNDS COLLECTED BY THE COUNCIL
SHALL BE USED IN ANY MANNER FOR INFLUENCING LEGISLATION OR ELECTIONS,
EXCEPT THAT THE COUNCIL MAY RECOMMEND TO THE PRESIDENT CHANGES IN THIS

S. 151 5

ARTICLE OR OTHER STATUTES THAT WOULD FURTHER THE PURPOSE OF THIS ARTI-
CLE.
S 14-108. PRICING. IN ALL CASES, THE PRICE OF PROPANE SHALL BE DETER-
MINED BY MARKET FORCES. CONSISTENT WITH THE ANTITRUST LAWS, THE COUNCIL
MAY TAKE NO ACTION, NOR MAY ANY PROVISION OF THIS ARTICLE BE INTERPRETED
AS ESTABLISHING AN AGREEMENT TO PASS ALONG TO CONSUMERS THE COST OF THE
ASSESSMENT PROVIDED FOR IN SECTION 14-105 OF THIS ARTICLE.
S 14-109. RELATION TO OTHER PROGRAMS. NOTHING IN THIS ARTICLE MAY BE
CONSTRUED TO PREEMPT OR SUPERSEDE ANY OTHER PROGRAM RELATING TO PROPANE
EDUCATION AND RESEARCH ORGANIZED AND OPERATED UNDER THE LAWS OF THE
STATE OF NEW YORK.
S 2. This act shall take effect immediately.

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